Udall, Senate Democrats Introduce Bill to Protect Consumers from COVID Scams
Bill would enhance FTC and State AGs authority to go after predatory scammers taking advantage of the pandemic
WASHINGTON – Today, U.S. Senator Tom Udall (D-N.M.), member of the Senate Commerce Committee and former New Mexico Attorney General, introduced new legislation to address the growing threat of COVID-19-related scams seeking to fleece American consumers. Udall was joined by U.S. Senators Jon Tester (D-Mont.), Richard Blumenthal (D-Conn.), Amy Klobuchar (D-Minn.), Bob Casey (D-Penn.), Dianne Feinstein (D-Calif.), Sherrod Brown (D-Ohio), and Bob Menendez (D-N.J.). The Stopping COVID Scams Act of 2020 would empower the Federal Trade Commission (FTC) and state attorneys general to better hold bad actors accountable for defrauding consumers during the current public health emergency.
Because of the COVID-19 crisis, Americans are increasingly working, socializing, and learning online. In addition, millions of Americans are facing financial struggles. As a result, Americans have been made more vulnerable to unsafe and counterfeit products and medical and financial scams perpetrated online or over the phone. Since January of this year, the FTC has received more than 130,000 consumer complaints related to the COVID-19 crisis. In total, consumers report losing nearly $90 million from COVID-19 related fraud at a time when they can least afford it. In April, Google reported that it was tracking 18 million COVID-19 malware and phishing emails each day.
“Throughout the COVID-19 pandemic, we have seen Americans come together to support frontline workers. We have seen New Mexicans rally as communities to help their families and neighbors,” Udall said. “But just as times of crisis can bring out the best in people, they can also bring out the worst who target vulnerable people. And that is what we have been seeing in numerous reports of scams. Every day products like masks, gloves and sanitizing supplies—which have now become life-saving products— should be affordable and widely available to every American, but scam artists are using fraud, price gouging, and other shady tactics to profit from this crisis. This bill will empower federal and state authorities to do more to deter scammers and hold them accountable. As a former New Mexico Attorney General, I will not stop fighting to protect New Mexico consumers from COVID-19 scams.”
“Cracking down on COVID-19 con artists is urgent and this measure will help do it,” said Blumenthal. “It will enable federal and state enforcers to combat scammers profiting from the pandemic. Illegal marketers have been pitching snake oil, ‘preventions,’ and ‘cures’ that can literally kill. The FTC and states must stop con artists hawking these deeply dangerous products. Scammers must be held accountable.”
“We must ensure that consumers are not being taken advantage of during the coronavirus pandemic. All Americans deserve safety and peace of mind, yet during this public health crisis new fraudulent schemes appear almost daily,” said Klobuchar. “This legislation will help protect consumers from fraud by giving the Federal Trade Commission and state attorneys general more authority to take action against those who commit these crimes and helps prevent emergency-related scams in the future.”
“It is outrageous that scammers are seeking to capitalize on public anxiety surrounding the COVID-19 pandemic to prey on consumers, especially seniors. It is important that Congress quickly pass the Stopping COVID Scams Act so that the federal government and state attorneys general have the tools they need to go after bad actors looking to take advantage of those looking for ways to protect themselves from the virus or accessing financial assistance,” said Casey.
“Ohioans should be focused on keeping themselves and their loved ones safe, not worried about a scammer going after their hard-earned money or putting their health at risk by peddling fake or even dangerous protective equipment or medical products,” said Brown. “This legislation would empower the FTC and state attorneys general to better hold bad actors accountable. We must ramp up our efforts to protect Ohioans, especially seniors, from those looking to defraud consumers or put their safety in jeopardy during a public health emergency, and offer recourse for those who have been scammed.”
U.S. Representative Ben Ray Luján (D-N.M.) led the introduction of companion legislation in the House and was joined by U.S. Representatives G.K. Butterfield (D-N.C.), Joe Kennedy III (D-Mass.), Dave Loebsack (D-Iowa), Jerry McNerney (D-Calif.), Tony Cárdenas (D-Calif.), Raúl M. Grijalva (D-Ariz.), Ed Case (D-Hawaii), Bill Pascrell, Jr. (D-N.J.), Eleanor Holmes Norton (D-D.C.), Peter Welch (D-Vt.), Tom O’Halleran (D-Ariz.), and Marc Veasey (D-Texas).
“With Americans already facing financial uncertainty, Congress must act immediately to address the growing threat of COVID-19 related fraud,” said Luján. “The Stopping COVID Scams Act protects consumers and empowers federal and state authorities to hold bad actors accountable. I’m pleased that Senator Udall will lead this effort in the Senate, and I look forward to working with him to get this critical legislation passed.”
The Stopping COVID Scams Act of 2020 allows the Federal Trade Commission (FTC) and state Attorneys General to impose civil penalties on COVID-19 scammers. The legislation would apply to the following deceptive acts and practices:
- Those involving goods and services advertised as related to the pandemic;
- Those involving goods and services that experienced an increase in consumer demand one month before the emergency and until the emergency ends;
- Those related to the federal or state response to COVID-19, including testing and treatment, unemployment benefits, and economic impact payments.
The full bill text can be found HERE.
The Stopping COVID Scams Act is endorsed by the Consumer Federation of America, the National Consumers League, Public Citizen, and Center for Science in the Public Interest.
“Scams linked to COVID-19 are harming consumers' financial and physical health on a daily basis. Agencies tasked with protecting consumers from this fraud should not have to operate with one hand tied behind their backs,” said Sally Greenberg, Executive Director of the National Consumers League. “That is why we are proud to support Congressman Lujan's common-sense bill, which will allow the Federal Trade Commission to use all the tools in its arsenal, including civil penalties, to fight back against the scammers.”
“Crooks are taking advantage of fear and confusion about the COVID-19 pandemic to trick people into giving them their money, their personal information, or both. It’s a no-brainer – Congress should enact the Stopping COVID Scams Act of 2020 immediately to strengthen the ability of federal and state consumer protection agencies to combat this fraud,” said Susan Grant, Director of Consumer Protection and Privacy for the Consumer Federation of America.
“It is critical that the state attorneys general have the tools they need to combat COVID scams and protect consumers in the pandemic. Senator Udall’s important legislation would put new tools in the state AG’s toolbox to battle fraud, and we hope it receives the wide and broad support in Congress it deserves,” said Laura MacCleery, Policy Director for the Center for Science in the Public Interest.
“We must protect the health and safety of New Mexican families during this pandemic, and that includes protecting them from fraud and abuse when they are most vulnerable,” said New Mexico Attorney General Balderas. “My office fully supports this legislation and will take action against anyone who breaks the law and takes advantage of New Mexicans.”
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